Premier Youthworks provides out-of-home-care services for children and young people in Canberra, but stop will providing services in the ACT as of August 14.

Former staff of Premier told the Sunday Canberra Times of horrendous working conditions that led them to leaving, including an inability to provide basic services like food, clothing and psychological support to the children and young people in their care due to company restrictions.

Premier Youthworks strongly refutes the allegations. In a statement, a company spokeswoman said the company operates in a heavily regulated sector which ensures working conditions and living standards of both staff and clients are effectively maintained.

"Premier Youthworks dedicates significant resources to workplace health and safety across all facilities and has established policies and procedures to deal with any such matters," the spokeswoman said.

She said the company provides high levels of support for all staff.

"Workers compensation claims are not unusual in a sector working with children and young people that have extremely challenging behaviours and high needs," she said.

Former employees said one of the core problems was the attitude of the company in dealing with problems and complaints.

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Slater and Gordon lawyer Alexandra Barry said the majority of the workers compensation claims she dealt with were psychiatric injury arising from poor work health and safety standards.

At one stage they had enough claims to run a class action, but decided the best course of action was to pursue the claims individually.

"[There was] a complete failing of reporting and supervision of largely inexperienced staff," Ms Barry said.

"It's some of the worst psychiatric injuries and workers compensation cases I've seen."

The for-profit company Premier announced it would cease to operate in Canberra as of August 14 due to reasons including a funding shortfall and an increase in workers compensation insurance. The company said the decision had nothing to do with the care they were providing. A letter to staff in late July said the insurance had increased by 400 per cent over the past two years.

The announcement has led to calls for better oversight of the sector, and the need for a not-for-profit provider to ensure all funds go towards supporting staff and the children in their care.

Ms Barry said oversight measures of the sector were failing, and greater scrutiny was needed so people weren't exposed to risk of harm.

"There were massive failings of the systems in place and that caused a lot of harm where it never should have happened," she said.

"All of [the claimants] were not supervised appropriately, all of the reporting to higher-ups was ignored.

"There were quite serious issues that were going on until it escalated to a point where it was causing significant distress to my clients."

WorkSafe ACT said no concerns had been raised with it about Premier's compliance with work health and safety laws.

The Sunday Canberra Times spoke to five former workers, on the basis of anonymity, who had left Premier in the past two years.

One person said they left after taking concerns to the company and having them dismissed.

"You're told from higher up that 'This is how we do it here'," they said.

But they said the biggest concern was the lack of psychological intervention for the children.

"Some had documented mental health issues going on, even if they didn't most of them had a history of trauma and associated mental health issues," the former worker said.

"I felt there were big human rights issues and it felt like as one employee, you didn't have the power to change that."

"You're going in relatively untrained, they didn't really offer much in the way of debriefing."

Another former worker said Premier refused to have two people working in homes at the same time, known as "double staffing", despite significant concerns about dangerous and violent children, or children with specific special needs.

"There was a massive amount of staff going in and out [of one house in particular] because nobody wanted to work there," the worker said.

The former worker said it was a good thing Premier was ceasing to operate in the ACT, saying, "I couldn't think of a company that deserves to be gone more".

The Premier spokeswoman said all employees received an "intensive induction program" including comprehensive training, and ongoing training was accessible. She said there were clinicians engaged to support young people.

"Premier Youthworks, Barnardos and Australian Childhood Foundation conduct fortnightly clinical review meetings at which any concerns regarding staffing, client needs and housing issues are addressed. It is important to note that due to our obligations for privacy and confidentiality of both staff and clients, outcomes of internal investigations may not be communicated back to the staff raising the matter," the spokeswoman said.

She said the company did their best to provide "the best possible care for children with the allocated funds and resources". She said it was not a requirement of the service agreement with Barnardos, nor was it funded, for homes to be double-staffed.

"However, Premier Youthworks regularly provides additional staffing on an 'as needed' basis. This depends on the individual circumstances in each home," she said.

Australian Services Union branch secretary NSW/ACT Natalie Lang said Premier Youthworks had a history of industrial disputes.

Ms Lang said there was a significant concern that the company operated as a for-profit provider, and anyone coming in to take over the role should be not-for-profit.

"In the provision of services of this nature it is not appropriate to have for-profit providers. No-one should profit off the vulnerability and marginalisation of anyone in our community. Every cent of government funds invested in supporting vulnerable young people has to go to that provision of service, in paying the staff appropriately and delivery high quality, sustainable services. There's no room for profit in that," Ms Lang said.